Vancouver Resource Investment Conference – Day 1 Recap

Vancouver Resource Investment Conference – Day 1 Recap

My January 20th in Vancouver was all about day 1 at Cambridge House’s Vancouver Resources Investment Conference (VRIC).  For most of the industry insiders and players reading this post, you already know the important place the VRIC holds in our industry.  For those of you who are not industry-types, the VRIC is one of what I call the “Big 3” conferences that start off each calendar year in junior mining.  It’s an institution.  Each year kicks-off with the Vancouver Resource Investment Conference in late January, followed by Indaba in Cape Town in early February, and then PDAC in Toronto in early March.

There had to be some 300 company exhibitors, over 60 speakers, and as I understand, in excess of 9000 registered attendees for the Vancouver Resource Investment Conference this year.  I would be remiss if I didn’t thank Marin Katusa and Jay Martin for inviting me to speak and for hosting yet another great event.

One aspect of the conference I really like is the recent introduction of the Deal Room – an area set aside for exhibiting companies and vetted industry players to hold meetings, planned ahead through a meeting coordination interface.

Beyond running into all kinds of old friends, visiting dozens and dozens of booths, and listening to great talks from some of our industry’s top thought leaders, I also had 21 meetings set-up in the Deal Room with companies I was interested in learning more about – 11 of them on day 1 alone.

For background, I had something like 70-80 meeting requests for the VRIC.  I only took 21 meetings since there are only so many hours in each day.  But I pre-vetted all these meetings to make sure I wouldn’t be wasting my time.  For the most part, they were all good companies, run by good people, and doing good things corporately and geologically.  But I can only buy so many.

When I look to buy a company, I view it through the lens of its share price and ultimately, its valuation.  I will take a position in a company for one reason only: to make money on an increase in the company’s share price.  My model is clear.  I don’t have paid subscribers, I don’t take payment for coverage, and I pay for my own site visits, etc. – I am completely independent.  I only make money if the shares of the companies I own appreciate in value.

And I like dirt cheap valuations.  I don’t like companies when there’s already been a meaningful increase in share price – I’m nobody’s distribution and liquidity.  I often meet companies that I like, that are really doing good things, and run by really good people but, often, I’ve missed the boat or they don’t have the valuation entry point I’m looking for.  They’re good companies but I’m just not interested in buying them at their current valuation.  If I don’t own a company, it’s not necessarily a negative reflection on the company – it might just be the company has done so well at executing that I don’t see the return I’m looking for.  I’m in this game for big wins, not 10% per year.

With that in mind, let me briefly summarize some of the better one-on-one meetings I had on day 1 of the VRIC.

The first company that really piqued my interest was Goldspot Discoveries which is still private but in the process of going public.  I met with Cejay Kim and Vincent Dube-Bourgeois who gave me some really good background on how Goldspot uses artificial intelligence to improve exploration success.  The company has a lot of big players involved as well as many PhD’s on the team.  It’s not your traditional junior mining company but Goldspot offers a very interesting way to play the sector through a portfolio approach.

Contact Gold (TSXV – C) holds a nice suite of gold projects in Nevada.  It has a very strong team lead by CEO Matthew Lennox-King.  The board is strong too – it includes Chairman John Dorward and directors George Salamis and Mark Wellings.  Contact Gold’s shareholder list is just as impressive with Waterton Global and Goldcorp owning 52% of the company.  Board and management has another 13%.  With a $15 million market cap this might be a good punt on a turnaround in gold prices – I’ll be keeping an eye on Contact Gold.

Another interesting company I met with was Adventus Zinc (TSXV – ADZN).  Its name is a little misleading since it’s primarily focused on looking for copper in Ecuador in association with Fredy Salazar’s aptly named Salazar Resources.  I have some experience in Ecuador and Fredy does indeed hold some of the best mineral exploration ground in the country.  Adventus is led by former investment banker Christian Kargl-Simard.  I had never met him before but he has that dog-hungry demeanor I love to see in CEO’s.  Curipamba is Adventus’ most advance project.  The company has a strong shareholder base with Altius, Greenstone Capital, Resource Capital (RCF), Wheaton Precious Metals, and board and management owning 67% of the shares.  At a $55 million MCap ($42 million EV), it’s a little expensive but I’m going to follow Adventus to see if I can find an entry point that I like.

And the last company I met that really impressed me was Idaho Champion Gold Mines (CSE – ITKO).  It has 2 gold projects and 1 cobalt project in Idaho.  The company is led by CEO Jonathan Buick, an old industry friend who I first met when I got going in this industry through his Buick Group and Harp Capital.  The Chairman of ITKO is Bruce Reid, currently CEO of Bunker Hill Mining and formerly Chairman and CEO of Carlisle Goldfields (acquired by Alamos Gold).  Idaho Champion’s 2018 drill results at their Baner project were awesome but seemingly fell on deaf ears.  With a miniscule $4.9 million MCap and a cobalt project that can garner value in this markert, Idaho Champion is a company I want to own.

That’s it for my day 1 report form the Vancouver Resource Investment Conference – I’ll have more for you tomorrow on my day 2 at the conference.

Philip O'Neill
Philip O'Neill
poneill@mp1capital.com